Electric merger customer deal 'insulting,' EDF says
In its most caustic blast yet against Exelon Corp.'s proposed buyout of Baltimore-based Constellation Energy, the French EDF Group called the combined company's offers to Maryland citizens "insulting" and says the deal will be "harmful to Maryland, harmful to BGE and harmful to consumers." The transaction "fails to meet every standard imposed by Maryland's public utilities law and should be denied," EDF said in a filing Monday with the Public Service Commission.
EDF, of course, is the parent of Electricité de France, the giant utility owned largely by the French government. EDF is a big Constellation shareholder and also shares ownership with Constellation of the company's nuclear fleet. EDF rescued Constellation from being bought by Warren Buffett three years ago, saving Constellation CEO Mayo Shattuck's job. Apparently it expected Shattuck to be grateful. Instead, Shattuck is pursuing a deal that is OK for his shareholders but which EDF fears will harm its interests by burying its U.S. nuclear stake within the much larger combination of Exelon and Constellation.
So EDF is missing no chance to blast the transaction. Exelon and Constellation "persist with the claim that after the merger, BGE somehow will be locally managed and controlled" EDF said in Monday's filing, "despite overwhelming evidence to the contrary." (The whole company would be run from Exelon's Chicago headquarters.) It goes on:
The evidence at the hearing further established that the merger’s so-called benefits for Maryland and Exelon’s commitments to Maryland are both woefully inadequate and totally illusory. Maryland jobs will be lost, Maryland tax revenues will decline, and Maryland’s ability to influence its electric generation facilities will be severely limited.
Also Monday, Constellation and Exelon agreed to boost the commitments that EDF says are woefully inadequate and insulting. See Hanah Cho's story on the companies' promise to build additional generation capacity, including more green power than they had previously talked about. Somehow, however, I don't think that's going to change EDF's mind.